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South Korean stock market's AI-fueled rally turns to panic selling
🇪🇪 Estonia /Economy & Trade

South Korean stock market's AI-fueled rally turns to panic selling

From Postimees · () Estonian

Translated from Estonian, summarized and contextualized by DistantNews.

At a glance

News Sources not specified Ongoing story
  • South Korea's stock market, which led global gains in the first half of the year due to high demand for memory chip manufacturers, has experienced a sharp decline in the past month.
  • Shares of memory chip producers, recently buoyed by artificial intelligence optimism, are now at the center of panic selling, wiping out significant company value.
  • Questions remain about the market's true bottom and the extent of risks, despite reassurances, concerning the impact on individual investors and the role of financial leverage.

South Korea's stock market has seen a dramatic reversal, transforming from a global leader in the first half of 2026 to a scene of panic selling. The boom, fueled by soaring demand for memory chip manufacturers driven by artificial intelligence, has evaporated in recent weeks.

Companies like SK Hynix and Samsung, once symbols of AI-driven growth, are now at the heart of a sell-off. Trading halts have failed to stem the tide, leading to a massive erosion of corporate value. This sharp downturn has replaced the earlier euphoria with a painful sobering.

The rapid shift from a hot investment idea to a crowded trap raises critical questions. How will these events affect individual investors, particularly those who may have used financial leverage? Despite reassurances, the market faces uncertainty regarding its actual bottom and the full scope of associated risks.

DistantNews Editorial

Originally published by Postimees in Estonian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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